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Tuesday, June 09, 2020

A Message on the Death of George Floyd from Dean Paul Caron

“I don’t trust anyone who’s nice to me but rude to the waiter. Because they would treat me the same way if I were in that position.”
– Muhammad Ali as often quoted by Brother Johnno at the Bear Pit


You do not need to leave your room. Remain sitting at your table and listen. Do not even listen, simply wait, be quiet, still and solitary. The world will freely offer itself to you to be unmasked, it has no choice, it will roll in ecstasy at your feet.
— Franz Kafka, who died in 1924


Lesson From The Tax Court: Do The Right Thing

Tax Court (2017)The protests dominating events recently have reminded me of Spike Lee’s classic film “Do The Right Thing.”  It’s a movie that explores how individual decisions that seem “right” from viewpoints blindered by race and class create seemingly inescapable conflicts.  It makes you question your perspective about “the right thing.”
I offer two recent Tax Court as a cautionary lesson that I hope makes tax professionals question their perspective about the right thing to do in tax return preparation and advice.  It’s not about race or class.  It’s about being blindered by client needs and client relationships, both on the part of taxpayers and the IRS.  Both cases show taxpayers, tax professionals, and the IRS all not doing the right thing.  In Enrique Aguilar v. Commissioner, T.C. Summ. Op. 2020-16 (May 26, 2020) (Judge Gerber), the tax professional created a fictional Schedule C.  In Thomas M. McCarthy v. Commissioner, T.C. Memo. 2020-74 (June 3, 2020) (Judge Thornton), the tax professional improperly claimed mortgage deductions on Schedule A.  Details below the fold.

The Australian Taxation Office has received thousands of tip-offs related to the suspected abuse of the federal government’s JobKeeper program.
As of May 31, 3338 complaints linked to JobKeeper were made to the ATO’s hotline, an ATO spokesperson told The New Daily. 
The tax office will cross check the information it has received in these tip-offs and “assess whether further action is required”.

Binetters on toast

Neil ChenowethSenior writer
When Andrew and Michael Binetter made a $45 million settlement with the Tax Office in October 2018, one of the conditions was that the Binetter family, the founders of Nudie Juice, agreed to help sue Israel Discount Bank.
Who’d be an Israeli banker? Last year Mizrahi-Tefahot Bank made a $US195 million settlement with the US Justice Department for helping clients avoid US tax involving back-to-back loan schemes similar
Binetters on toast

SOMETIMES YOU NEED TO SPEAK FRANKLY:  Whence Comes Dignity

Over the past week or so, I have seen far too many decent people in the arts apologize for their eminently reasonable opinions, and I'm sick of it.

Hugh Jackman, for example, didn't do anything wrong when he posted that picture of a cop hugging a protester. For eff's sake, isn't that what we want? Don't we want police officers to connect with the communities they're supposed to serve? Don't we want these cops to see the fundamental humanity of the people under their jurisdiction? There's nothing in such a photo that suggests a lack of concern when it comes to police brutality. On the contrary, I'd say that sort of interaction is desperately needed to prevent law enforcement officials - who often get exposed to the worst mankind has to offer - from checking out and consequently treating arrestees like animals.

Comics writer/artist Sean Gordon Murphy also didn't do anything wrong when he tweeted:


COMPELLED SPEECH IS NEVER ABOUT WHATEVER IT PRETENDS TO BE ABOUT:  Creatives: These Are Struggle Sessions. DON’T SUBMIT.

As former newspaper man Rod Dreher writes, “Every now and then, a young person will ask me what advice I have for someone who is thinking about becoming a journalist. My advice: don’t do it. If you are an honest person — whether you’re liberal, conservative, or somewhere in between — you are going to live in constant fear of inadvertently causing a job-ending offense. You will end up a nervous wreck, or you will end up as a conformist drone, or you will end up jobless.”


THALIA ANTHONY. ‘I can’t breathe!’ Australia must look in the mirror to see our own deaths in custody (THE CONVERSATION 2.6.20)



I can’t breathe, please! Let me up, please! I can’t breathe! I can’t breathe!

Citing racism and violence, China warns against travel to Australia


China did not give any specific examples of such discrimination or violence.



ALEX MITCHELL. We are not “All in this together”!



Since COVID-19 was officially recognised as a killer pandemic in March 2020, NSW people, and Australians generally, accepted the view that it does not distinguish between classes, colour, religion, gender or age. Then politicians, urged by bankers and the super-rich, began to use the coronavirus crisis for their own personal gain. Continue reading 


Artist Response To Injustice? Seven Musicians Speak Out


“What’s really important is to take a step back and look at the macro picture, and think through, how did we get here? What are the underlying causes? There’s this phrase flying around a lot for coronavirus, that the disproportionate impact on black or minority communities is due to “underlying health conditions.” Well, what were the conditions that created the underlying health conditions, and what can we do to start picking away at that? And it’s so unsexy, but the census helps a lot.” – NewMusicBox

fraudulent income tax refund requests with the states and the U.S. Internal Revenue Service (IRS),...


In a powerful essay for The Atlantic, Ibram X. Kendi writes about The American Nightmare.


In 2009, novelist Haruki Murakami controversially accepted the Jerusalem prize for the Freedom of the Individual in Society in the aftermath of Israeli military action in Gaza. In his acceptance speech, he related a story about something he keeps in mind while writing:
“Between a high, solid wall and an egg that breaks against it, I will always stand on the side of the egg.”
Yes, no matter how right the wall may be and how wrong the egg, I will stand with the egg. Someone else will have to decide what is right and what is wrong; perhaps time or history will decide. If there were a novelist who, for whatever reason, wrote works standing with the wall, of what value would such works be?
What is the meaning of this metaphor? In some cases, it is all too simple and clear. Bombers and tanks and rockets and white phosphorus shells are that high, solid wall. The eggs are the unarmed civilians who are crushed and burned and shot by them. This is one meaning of the metaphor.
This is not all, though. It carries a deeper meaning. Think of it this way. Each of us is, more or less, an egg. Each of us is a unique, irreplaceable soul enclosed in a fragile shell. This is true of me, and it is true of each of you. And each of us, to a greater or lesser degree, is confronting a high, solid wall. The wall has a name: It is The System. The System is supposed to protect us, but sometimes it takes on a life of its own, and then it begins to kill us and cause us to kill others — coldly, efficiently, systematically.




Calling it one of their most requested videos, PBS’s Frontline has uploaded to YouTube their 1985 program on schoolteacher Jane Elliott’s powerful lesson in discrimination. The video shows how, in the wake of Martin Luther King Jr.’s assassination, Elliott divided her third-grade class into those with blue eyes and those with non-blue eyes and then instructed the non-blue-eyed group to treat the blue-eyed group as inferior. The resulting behavior is fascinating, upsetting, and illuminating.

Elliott went on to become a noted antiracism activist and has done blue eyes/brown eyes workshops with groups of adults and teens. And she goes hard at them — see this video and this video for instance.

I’m trying to get the people who participate in this exercise the opportunity to find out how it feels like to be something other than white in this society. ‘Alright people, I’m Jane Elliott and I’m your resident bitch for the day and make no mistake about that, that is exactly what this is about.’ I do this in a mean, nasty way because racism, sexism, ageism, homophobia, ethnocentrism are mean and nasty.

I would also highly recommend watching this brief clip of a talk by Elliott. In less than a minute, she deftly skewers the idea that racial discrimination doesn’t exist in America and calls out white Americans’ complicity in allowing it to persist

In a message to the community on Monday evening, Dean Paul L. Caron wrote:

I am deeply saddened and outraged by the ongoing acts of racial injustice and senseless violence we are witnessing in our city and throughout the nation. We are all created in God's image and called to do God's work in this world by loving one another. As the university's Statement on Diversity affirms: "Pepperdine is a Christian University fully committed to diversity, equity, and inclusion. Our faith cherishes the sacred dignity of every human being."

The Caruso School of Law embraces our responsibility to address systemic injustices in our society. Our mission is to provide our students with the tools they need to become future leaders who will effect positive change in the world. We are especially concerned for our Black students at this time. We know you are hurting and trying to make sense of the images and messages you are hearing. Please know that this community is here to support you not only in word, but in deed.

Huge thread of over 300 instances of police violence against protestors caught on video over the past week. The police are rioting on America's streets – and getting paid for it! This is sickening, immoral stuff. (Content warning: police violence.)


IRS Solicitation for Outside Expertise in CryptoCurrency Audits 



There are reports that the IRS has sent out a “Statement of Work” soliciting assisting from contractors to help with audits involving potential cryptocurrency transactions.  See Guinevere Morre, Got Cryptocurrency? Get Ready For An IRS Audi (Forbest Editors’ Pick 5/29/20), here; and IRS Soliciting Contractors to Help Audit Crypto Tax Returns (CryptoTrader.tax blog), here(with a copy of the Statement of Work).

The introduction says:
The Internal Revenue Service (IRS) requires consulting services to support a taxpayer examination involving virtual currency. In particular, the IRS requires consulting services to calculate taxpayers' gains or losses as a result of their transactions involving virtual currency. Specific requirements are outlined below.
 The Statement of Work process is described here.

The use and trading in cryptocurrency offers great opportunity for tax avoidance and evasion, so it is not surprising that, given the IRS cryptocurrency push, it would seek outside expertise to assist.